E-commerce set to boom in SA

Besides 2014 being a tough year for online businesses, there has been an increase in query volumes for South Africa of 37% – and increases of 49% in Nigeria and 33% in Kenya.

This is according to Nicholas Groove, business development manager at ImproWeb, sister company of distributor Esquire Technologies

Groove points out that Google recently reported that Africans are increasingly Googling – and are often Googling with the intention of buying.

At the time, Google South Africa’s country director Luke Mckend says 2015 is expected to be another growth year for e-commerce. “We see a story of growth. Search is growing much faster than in mature Internet economies. What is particularly interesting is commercial intent queries, searches for purchasing information,” he says.

These types of searches are apparently Google searches with the aim to ascertain a price for a certain good, and a shop where a service or product could be purchased.

It is also a natural assumption that the more time people spend online, the more prone they are to purchase online, reckons Groove.

Google statistics show that with South Africa’s total query growth between 2013 and 2014 measuring up at 37% the commercial intent query base has grown by 55%.

Mckend says this indicates that there is a certain degree of maturity with buying online – something that was missing a few years ago – and that he is “excited” about the opportunities for e-commerce going forward, believing that a
massive e-commerce market will indeed come to the fore by 2017.

“Companies who are not offering e-commerce platforms for companies and individuals need to get their battle plans together rapidly,” says Groove. “If they cannot offer both brick-and-mortar operations, together with e-commerce, they are likely to see their sales dwindle during the next decade.

“Even though online retail sales still account for less than 5% of total retail sales in South Africa, this figure is growing – and it will become an increasingly material figure for companies.
“It is an indication that e-commerce, and online sales, cannot be ignored. Companies will ignore them at their own peril.”